This morning, Cowen & Co. felt it prudent to cut its earnings estimate for AT&T (T: sentiment, chart, options), noting that strong iPhone sales were costing the company money through subsidies. T started subsidizing the purchase price of Apple's (AAPL) iPhone when the new model was launched in the U.S. during July. The exact subsidy for each phone is unknown, but it is assumed to be in the hundreds of dollars. T believes it will make that money back over time thanks to service fees.

The brokerage maintained the company's "outperform" rating, mainly due to its 7% dividend yield. Cowen believes the company will continue its regular dividend increases with another elevation in December. That said, the brokerage lowered T's third-quarter earnings estimate to 69 cents per share, down a nickel from its prior forecast. The firm also expects 2009 earnings of $3.08 per share, down from $3.43 per share. The ratings house did maintain its "outperform" rating on the shares. Nevertheless, T is roughly 2% lower as we head into the final 4 hours of the trading week.